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Friday, 18 November 2011

Govan Law Centre (GLC) is concerned that the OFT's Debt Collection Guidance is being routinely ignored in Scotland not only by UK debt purchasing companies but more worryingly by certain firms of Scottish solicitors who undertake debt collection as one of the primary activities of business.

Besides causing unnecessary human misery, unfair, oppressive, and disproportionate business practices are resulting in vulnerable Scottish homeowners being threatened with homelessness as creditors use inhibitions for tiny debts. The practice results in creditors being able to scupper Scottish Government mortgage to rent transactions, where families facing homelessness can have their house purchased by a social landlord.

Although, the OFT expects solicitors firms who undertake debt collection work as one of their primary activities of business to obtain a 'Category F' consumer credit licence, most Scottish debt collection firms of solicitors operate under the Law Society of Scotland's 'group consumer credit licence'. GLC believes this results in a lack of effective regulation of Scottish law firms undertaking debt collection work because the Law Society of Scotland does not specifically regulate such work, and therefore, this work appears to be largely unregulated in practice.

GLC's Mike Dailly said:

"To give an illustration of the problem, we have a case in Glasgow where it has taken us many months to defend a repossession action and broker a complex mortgage to rent transaction, which is now being thwarted by a Scottish firm of solicitors acting on behalf of an English debt purchasing company for a debt of £810. Last month the company was prepared to accept repayment at £5 per week, but since obtaining an inhibition it wants all of the money as a lump sum".

"Our client is on incapacity benefit and has offered £100 plus £5 per week but the company's solicitors advise their client says no. We believe this Scottish law firm and company have engaged in aggressive, oppressive, and unfair practices contrary to the OFT's expected standards for consumer debt recovery, and contrary to section 25 of the 1974 Consumer Credit Act".

"Govan Law Centre is considering all legal remedies available to our clients against such companies and their Scottish solicitors - including where appropriate 'naming and shaming' - however, it is quite clear there is a major regulatory role here for the Law Society of Scotland which needs to be addressed, a need for the OFT to intervene, and ultimately a pressing need for the Scottish Government to review the ability of their own Mortgage to Rent scheme to be de-railed by unsecured creditors with relatively tiny debts through the inappropriate use of inhibitions".

Saturday, 12 November 2011

The Herald reports that Scots lawyers have called for a change in legislation north of the Border to make it easier for abuse victims to claim compensation. The move comes after an English High Court ruling opened the door to people who suffered at the hands of priests to sue the wider Catholic Church as vicariously liable in tort (delict in Scotland) and not just the individual.

While the ruling in England is not binding in Scotland, human rights lawyers Mike Dailly, of Govan Law Centre, and John Scott, of Capital Defence Lawyers, say it is a significant step that would offer a “persuasive” precedent in the argument if such cases are now raised in Scotland.

Currently actions relating to personal injuries have to be brought within three years, or in the case of children within three years of turning 16, unless certain exceptions apply or the claimant can persuade the court that it would be equitable to disapply the time bar. A Scottish Parliamentary committee will shortly examine a Scottish Government proposal to extend the time bar to five years, but campaigners say this does not go far enough.

GLC's Mike Dailly said: “Very often the nature of sexual abuse is such that many vulnerable people cannot even speak of it until after the time bar has elapsed. The Scottish Government has so far refused to change the law here, but it cannot be right that a victim of sexual abuse in Scotland should be denied access to justice due to a technical time bar rule – justice demands change here.”